Euro bailout chief: Greek exit would be disorderly

BEIJING, June 3 (Reuters) - A Greek exit from the euro would
be a disorderly process and a costly solution, the head of the
European Stability Mechanism said on Wednesday, days before
Athens is due to make the first of four payments to the
International Monetary Fund.

Speaking at Beijing's elite Tsinghua University, Klaus
Regling said the euro zone would make every effort to keep
Greece in, but limited resources meant there had to be
conditions for financial aid to Greece.

Shut out of bond markets and with bailout aid locked off,
Greece is running out of cash to pay its bills. It must repay
four loans totalling 1.6 billion euros to the IMF this month,
starting with a June 5 payment of 300 million euro that is seen
as the next crunch point for state coffers.

The ESM was set up in 2012 to provide financial aid to euro
zone member states in difficulty. It is backed by capital from
euro area countries.

A Greek government spokesman said on Wednesday Greece would
not make its June 5 loan repayment to the IMF if there was no
chance of an aid-for-reforms deal with international creditors.

If Greece misses a payment to the IMF it would have a grace
period of 30 days or more to make good on its debt.

But the country's future, at that stage, would be bleak.
Greece has to repay more than 6.5 billion euros in July and
August, as bonds held by the European Central Bank and other
central banks mature.
(Reporting by Koh Gui Qing; Writing by Sui-Lee Wee and Ben
Blanchard; Editing by Clarence Fernandez)